FOR IMMEDIATE RELEASE
Wednesday, July 22, 2020
Contact: Pamela Russell at 202-618-6433 or prussell@bettermarkets.com
Washington, D.C. – Lev Bagramian, Senior Securities Policy Advisor for Better Markets, issued the following statement regarding the Securities and Exchange Commission’s final vote today on a proxy advisory firm rule that will negatively impact investors.
“Today, in what has now become a sad tradition, the SEC voted in a partisan fashion for a rule that will harm investors and give corporate management new powers to suppress the voices of proxy advisory firms. These firms are a market-based solution that supply investors who do not have the time or resources to research the proxy issues themselves with independent and useful information on how shareholders should vote their proxies.
“Proxy advisory firms provide objective research and recommendations on the issues, nominations and matters related to executive compensation that are on the proxy ballot. These firms also maintain voting systems that enable shareholders to exercise their corporate suffrage. The final rule—while improved from the nakedly anti-investor proposal a few months back—nonetheless fails to show any market failure that would require government intervention. The vast majority of commenters opposed the changes, including almost all investors. No surprise there. Proxy advisory firms help shareholders by providing independent advice to investors needed to make informed investment decisions and hold corporate managements accountable.
“Today’s rule will weaken this important check on corporate power. Instead of focusing on empowering investors and encouraging increased corporate accountability through the adoption of a “Universal Proxy” and improving the proxy voting process—reforms that shareholders large and small have asked for—the SEC has approved a clearly ideologically driven rule that was lobbied for by corporations and their trade associations for years.”
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Better Markets is a non-profit, non-partisan, and independent organization founded in the wake of the 2008 financial crisis to promote the public interest in the financial markets, support the financial reform of Wall Street and make our financial system work for all Americans again. Better Markets works with allies – including many in finance – to promote pro-market, pro-business and pro-growth policies that help build a stronger, safer financial system that protects and promotes Americans’ jobs, savings, retirements and more. To learn more, visit www.bettermarkets.com.
